SOUTHEAST Asian nations on Friday vowed to work towards a "code of conduct" in the disputed South China Sea, but failed to fully mend a rift that marred a regional meeting last week.

Current chair Cambodia announced that the Association of Southeast Asian Nations (ASEAN) had agreed on six principles on the sea, where tensions have flared recently with Vietnam and the Philippines accusing Beijing of increasingly aggressive behaviour.

The statement - which also includes a commitment to respect international laws and the non-use of force to settle disputes - is an attempt to dispel perceptions that the 10-nation bloc is divided.

The Philippines said it was "pleased" with the outcome.

Divisions over the territorial disputes with Beijing prevented ASEAN from issuing its customary joint statement at the conclusion of a meeting in Phnom Penh on July 13, an unprecedented occurrence in the bloc's 45-year history.

But signs of discord remained as Cambodian Foreign Minister Hor Namhong told reporters Friday that the points were broadly similar to what was rejected by Vietnam and the Philippines last week, and blamed them for the earlier impasse.

"Why did two ASEAN countries absolutely oppose (it) and now they agree with it?" said Hor Namhong.

Diplomats had said a key sticking point previously was a refusal by Cambodia, a close China ally, to mention bilateral disputes in the sea, pitting it against Manila, which wanted a reference to a months-long standoff with Beijing over the Scarborough Shoal.

China claims sovereignty over nearly all of the resource-rich sea, which is home to vital shipping lanes, but ASEAN members the Philippines, Vietnam, Malaysia and Brunei have overlapping claims in the area.

The six-point agreement, which does not give details about specific incidents, follows intense diplomatic efforts by Indonesian Foreign Minister Marty Natalegawa, who visited Hanoi and Manila on Wednesday followed by Phnom Penh.

Hor Namhong said the envoy had chosen Vietnam and the Philippines "because these two countries caused the problem that led to the failure of issuing a joint communique".

STATE DEPARTMENT — China's move to base troops on a disputed island in the South China Sea has raised concerns about a possible military confrontation in an area where China, Vietnam, Malaysia, Taiwan, Brunei and the Philippines all have competing claims.

Sansha City

​​China's newest city and military garrison is on an island that also is claimed by Vietnam and Taiwan, at a time of increasing tension over mineral and transport rights in the South China Sea.

"The establishment of Sansha City is a wise decision by the Chinese Communist Party's Central Committee to safeguard national sovereignty and security," said Xiao Jie, the First Mayor of the new Sansha City. "To strengthen the protection of resources and overall development in the South China Sea."

Beijing plans to use its Sansha base to increase patrols in waters claimed by Vietnam and the Philippines.

Dispute over terrority

The Philippines refuses to recognize the establishment of Sansha City.

Lawmaker Walden Bello serves on the Philippine House of Representatives' Foreign Affairs Committee. "This is a move that only falls within China's territorial land-grabbing logic," he explained. "And it is an illegitimate move to set that up."

Analysts say that pushing ahead with Sansha City demonstrates China's confidence in the standoff.

Justin Logan is Director of Foreign Policy Studies at the Washington-based Cato Institute. He says that confidence might be misplaced. "I think there is danger for miscalculation -- for the Chinese overplaying their hand and someone crossing someone else's 'red line' [i.e., limits] unknowingly," he said.

Protests

Analysts say China has countered Philippine and Vietnamese protests by using Cambodia to divide the Association of Southeast Asian Nations, or ASEAN.

Logan says China might be overplaying its hand with the Sansha garrison because troops on the ground are hard to explain away. "There are certain countries, obviously Cambodia, and other countries in the region and in ASEAN, that have been more or less willing, for a variety of different reasons, to be supportive of China in this context," he added. "And I think that this could really put pressure on them to say, 'Look, we can't back you up on this. Maybe we will just sort of sit this out or we won't make a statement on it at all.'"

U.S. State Department Spokeswoman Victoria Nuland says the dispute cannot be resolved by force. "We remain concerned should there be any unilateral moves of this kind that would seem to prejudge an issue that we have said repeatedly can only be solved by negotiation, by dialogue and by a collaborative diplomatic process among all of the claimants," she stated.

Although the United States has no territorial claim in these waters, the Obama administration says no nation can fail to be concerned by the increase in tensions and confrontational rhetoric over the South China Sea.

Japan is concerned that China's increased naval operations in the western Pacific coupled with a lack of transparency over who sets the country's military agenda are posing a security threat in the region, according to its annual defence report released yesterday.

As Chinese operations in the waters around Japan are becoming a routine occurrence, the report said uncertainty over how much power the military has in the decision-making process compared to the Communist Party leadership makes it difficult to understand the military's motives.

It said the strides China's military has made toward becoming a more powerful and more modern force has complicated its relationship with the Communist Party, though it said it remains unclear whether the military has a stronger or weaker voice in national decision-making.

"Some see that relations between the Chinese Communist Party leadership and the People's Liberation Army have been getting complex," it said. "Others see that the degree of military influence on foreign policy decisions has been changing."

Japan has frequently criticised China in past reports for not being open enough about its military decision-making process, but Japanese Defence Ministry officials who briefed reporters said this is the first time it has raised the relationship between the military and the civilian leadership as an issue.

"China is still not living up to the expectations of transparency that would be hoped for from a great nation with responsibilities to the international community," the report said.

The report noted that China's defence budget has increased 30-fold over the past 24 years and that its navy is trying to improve its ability to operate in the open seas so that its ships can carry out missions farther away from its own shores.

It said that has meant more frequent Chinese activity in the East and South China Seas and "routine advancements to the Pacific Ocean by Chinese naval surface vessels".

Chinese military activity has been evident lately in territorial disputes that have raised regional tensions. Japan and China are at odds over the Senkaku islands - called Diaoyu in Chinese - and China's navy has been increasingly involved in disputes over islands in the South China Sea.AP

BEIJING - China has indisputable sovereign rights over the South China Sea islands and their adjacent waters, and the country opposes any military intervention in this area, a spokesman for China's Ministry of Defense said Tuesday.

According to relevant rules, a regular combat-readiness patrol system has been established in sea waters under China's jurisdiction, Geng Yansheng, the spokesman, said in response to a question at a press conference.Geng said the system was established to maintain the country's territorial sovereignty and safeguard its maritime rights, and it is not targeting any other country or specific goals.

"The Chinese navy is justified in protecting the country's interests, and it is groundless to equate such a justified action with tough foreign policy," he said.

Geng also said the establishment of the Sansha garrison in the South China Sea is responsible for defense mobilization, militia reserves, the relationship between the garrison and local government as well as the city guard, support for the city's disaster rescue and relief work, and direct militia and reserve troops in the city of Sansha.

"The formation of troops and arms mainly depends on its military tasks," Geng added.Geng also said the establishment of the city of Sansha is a readjustment by the Chinese government to existing administrative bodies, which is an issue within China's sovereignty and unrelated to other countries.The disputes over the South China Sea mainly revolve around the sovereignty over some islands and part of the sea delimitation in the area, Geng said.

"China will continue to seek appropriate solutions through bilateral negotiations and consultations with the parties directly involved in the concerned disputes," Geng said.

China is also willing to cooperate with the Association of Southeast Asian Nations (ASEAN) in all fields, including the defense security relationship, in order to boost regional peace, stability and prosperity, Geng added.

THE United States could base a US aircraft carrier and supporting fleet in Perth, under plans to be presented to Congress today.

The proposal is one of four options set out in a report by the Centre for Strategic and International Studies commissioned by the US Defence Department.

The centre was directed to consider how the US military could undertake the so-called “pivot” in the Asia-Pacific region announced by President Barack Obama last year in response to China’s increasing influence.Chinese analysts immediately identified the plan as likely to antagonise China, saying it would confirm suspicions of an effort to contain it. Such a move would raise the temptation for China to use its huge economic leverage to retaliate, they said.“It would be interpreted within China as another move to encircle China,” said Sun Zhe, the director of Tsinghua University’s Centre for China-US Relations.

Song Xiaojun, editor of Naval and Merchant Ships magazine, said Australia would be unlikely to proceed with the proposal after it weighed security gains against export losses.

“Do they think China one day will invade Australia and rob its iron ore? said Song, formerly an analyst with a People’s Liberation Army academy.

The strike group would include a nuclear-powered aircraft carrier, a carrier air wing of up to nine squadrons, one or two guided-missile cruisers, two or three guided-missile destroyers, one or two nuclear-powered submarines and a supply ship.

The report also suggests that the US could consider building facilities to support “bombers and other aircraft”.

“Australia‘s geography, political stability and existing defence capabilities and infrastructure offer ... significant military advantages to the United States in light of the growing range of Chinese weapons systems,’’ it says. “HMAS Stirling offers advantages including direct blue water access to the Indian Ocean ... submarine facilities including a heavyweight torpedo maintenance centre and the only submarine escape training facility in the southern hemisphere.’’

The document — which includes advice from Andrew Shearer, foreign policy adviser to former prime minister John Howard — provides the greatest detail yet about exactly how the United States sees its new role in the Asia-Pacific and Australia.

Defence Minister Stephen Smith said in a speech in Canberra last night that Australia would look at an increased US presence at HMAS Stirling.

‘‘For Australia, this presence will support our long-held strategic interests in maintaining and expanding US engagement in our region.’’

He reasserted the need for a strong alliance with the US, as it had underwritten stability in the region for the past half-century ‘‘and will continue to be the single most important strategic actor in our region for the foreseeable future’’.

Responding to a question, the minister said: ‘‘The US does not have a base in Australia and this will not change’’.

Mr Smith insists that the Northern Territory military base through which up to 2500 US marines rotate for training each year is not a US base. The report is believed to moot the possibility of increasing that number.

West Australian Premier Colin Barnett dismissed the notion of such extensive US forces at Stirling.

‘‘I don’t think there’s any possibility of that happening,’’ he said.

‘‘I don’t think you could squeeze a nuclear aircraft carrier into Cockburn Sound.’’

The Greens reacted negatively. ‘‘The risks of routinely floating nuclear reactors in and out of Cockburn Sound shouldn’t be underestimated,’’ West Australian Greens senator Scott Ludlam said.

‘‘Western Australian police and emergency services personnel are completely under-resourced to cope with even a minor reactor leak.’’

The head of a Canberra think tank also rejected the idea, though for different and multiple reasons.

Peter Jennings, a former deputy defence secretary and now the executive director of the Australian Strategic Policy Institute, said the idea was unrealistic, citing the cost — anywhere between between $US1 billion and $US6.7 billion — as prohibitive in the context of deep US defence budget cuts.

What was likely, however, was more US naval ship visits to Stirling, he said.

Authors of the Centre for Strategic and International Studies report were scheduled to give testimony before the US Congress Armed Services Committee overnight, Melbourne time.

The report notes: “Australia is unique among America‘s allies in having fought alongside the United States in every major conflict since the start of the 20th century.”

While Perth was a long way away from some strategically important areas, the report says the West Australian capital’s location could also be a benefit because it was beyond the increasing range of China’s defences.

A spokesman for the centre said the think-tank was unable to comment on the report until after some of its authors had testified before the Senate committee.

The Armed Services Committee’s chairman, Senator Carl Levin, said he agreed with comments made by Secretary of Defence Leon Panetta that ‘‘efforts to strengthen alliances and partnerships in the Asia-Pacific to advance a common security vision for the future are essential to the US strategy to rebalance toward the region’’.

AN AMERICAN naval base in Perth would confirm suspicions of an effort to contain or encircle China, say Chinese analysts.

Such a move would raise the temptation for China to use its enormous economic leverage to retaliate, they say.''Of course it would damage the atmosphere,'' the director of Tsinghua University's centre for China-US relations, Sun Zhe, said. ''It would be interpreted within China as another move to encircle China.''

But they played down the likelihood of the Perth facility ever eventuating, saying Australia would take its economic interests into account and the US would be constrained by its own budget problems.Advertisement

Chinese analysts view regional strategic issues through the prism of what US leaders call their ''pivot'' or ''rebalancing'' back towards Asia.

A series of senior civilian and military analysts have warned countries, including the Philippines, Vietnam and Japan, against being used by the US to preserve its hegemonic power.

''Such a band of eager lackeys is exactly what the US needs for its strategic return to Asia,'' wrote the deputy chief captain with China Marine Surveillance, Xu Zhirong, in a recent magazine article.

Australia's role in America's ''return to Asia'' is the No. 1 question Chinese leaders have given to visiting Australian counterparts this year.

The editor of Naval and Merchant Ships magazine, Song Xiaojun, said Australia would be unlikely to proceed with the Perth proposal after it weighed any security against the resource exports it stood to lose.

''Do they think China one day will invade Australia and rob its iron ore? Mr Song said.He said China would cut off trade with Australia if, for example, Australia joined the US in ''interfering'' in a sovereignty dispute in the South China Sea.

BEIJING:India and Vietnam should be given a "strong response" if they insist on exploring oil and gas in waters claimed by China, a Chinese newspaper has said.

"China must first insist on exerting political pressure over both India and Vietnam, warning them that their joint exploration in the South China Sea are illegal and violate China's sovereignty," the Global Times said.

"If they conduct oil and gas exploration in waters under China's sovereignty, China should give a strong response," added the paper, which is known reflect hardline nationalist thinking in China.

The Times said Tuesday that its reporter wrote the story based on an interview with Su Hao, director of the Asia-Pacific Research Centre at the China Foreign Affairs University.

India's state-run Oil and Natural Gas Corp (ONGC) recently announced that it has accepted Vietnam's proposal to continue to explore for oil and gas in the South China Sea, it noted.

This happened after Hanoi offered additional data that could help make future exploration economically viable.

"Such a move is obviously a complete about-turn in India's policy as Indian officials had said in May that the ONGC had decided to return Block 128 to Vietnam since exploration there wasn't commercially feasible.

"Vietnam's renewed offer to India came after the China National Offshore Oil Corp (CNOOC) decided to offer nine blocks in South China Sea for joint exploration with foreign companies, including Block 128."

The Times said the "strategic intention" of India's renewed involvement in the South China Sea issue was obvious.

"New Delhi wants to further complicate the issue and seeks to pin down China in the area so it could gain dominance in affairs across the region.

"It is clear that such cooperation between Indian and Vietnamese companies in South China Sea is motivated more by politics than economic interests.

"India believes that the rise of China poses a challenge, and it is trying to find ways to contain China.

"To achieve the goal, India has conducted joint military drills and stepped up security cooperation with countries that have disputes with China in the South China Sea.

"At the same time, India also wants to strengthen its economic presence in the area.

"Vietnam's offer of joint oil and gas exploration in the South China Sea provides an excellent opportunity for India to promote its strategy.

"Vietnam wants to take advantage of India's strategy to confront China. New Delhi and Hanoi do share common interests on the issue," the newspaper said.

The Times said that compared to India and Vietnam, China had advantages in its deep water drilling technologies.

"When the conditions are ripe, China should expand its exploration of oil and gas in the South China Sea."

Australia has been urged to do more to help ease tensions in the South China Sea. China and Vietnam disagree about territorial claims, while other countries, including the United States and the Philippines, have also been drawn into the long-running dispute.

Various nations have argued about territorial rights in the South China Sea for hundreds of years. However, a recent upsurge in tension has raised concern that armed conflict could strike the volatile region.

China bases its claim on a large part of the South China Sea on 2,000 years of history, which it claims gives Beijing a compelling argument for controlling vast swathes of water. Chinese officials argue that the Paracel and Spratly island chains were once important parts of the Chinese nation and could have rich reserves of fossil fuels.

In this photo taken on July 20, 2012, Chinese fishing boats sail in the lagoon of Meiji reef off the island province of Hainan in the South China Sea. /AP

However, Vietnam and the Philippines strongly refute China's claim.

Lowy Executive Director Michael Wesley says the disputes could have global implications. "The first level is a set of territorial disputes between China and several Southeast Asian countries," he said. "The second level is a dispute between China and the United States over the conditions under which ships pass through this waterway, which conveys about a third of all global shipping. And, I feel that there is a real chance that conflict could break out because of inexperienced maritime forces, with little or no mutual understandings of how to manage maritime incidents."

Wesley is calling on Australia, which has strong military ties to the United States and an entrenched economic relationship with China, to do more to broker a deal in the South China Sea.

"Look, Australia really needs to be more concerned about this issue," he said. "About 54 percent of Australia's trade passes through the South China Sea, and really what is at stake for Australia here is the outcome of the standoff between China and the United States could have a real effect on the strategic balance of the Pacific Ocean. So we have really big interests in this."

Wesley says that maritime tensions pit communist China and Vietnam against one another, unite usual enemies China and Taiwan, and draw the United States back into partnership with Vietnam.

The regional political bloc ASEAN (the Association of Southeast Asian Nations) is continuing to explore new ideas to resolve the dispute.

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